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“The desire to perform all the time is usually a barrier to performing over time.” – Robert Olstein
Well, it’s just not looking like it’s going to be a week for the bulls as US stocks are poised for their third straight day of declines in what would be the longest losing streak since early March. There’s still practically no economic data to speak of this week as the only report today was mortgage applications. Don’t worry, though, the pace of reports will really pick up tomorrow, and earnings season has already kicked into gear.
So far this week, the trend of reports has been positive as more than 85% of S&P 500 companies reporting have topped EPS forecasts, and more than three-quarters have topped revenue estimates. Those are strong results, although stock price reactions have been somewhat uninspiring with stocks reporting on Monday and Tuesday morning falling an average of 0.79% in reaction to their reports.
Read today’s Morning Lineup for a recap of all the major market news and events including a recap of the biggest overnight events including some key earnings reports, economic data from around the world, some surprising political polls in Germany, as well as the latest US and international COVID trends including our vaccination trackers, and much more.
Stocks haven’t only been down in the US this week. Japan’s Nikkei fell 2% for the second straight day overnight as a new COVID wave there continues to accelerate. At current levels, the Nikkei is trading right at levels that have acted as support multiple times in the last couple of months as the index continues to trade in a somewhat narrow range.
From the perspective of a US investor, the chart below shows the Nikkei’s performance in dollar-adjusted terms. From this view, the chart doesn’t look all that different as the Nikkei remains right at the bottom of its recent range, although the drawdown from its February high has been a bit steeper.